Friday Closing Dairy Market Update - July Fluid Milk Sales Decline 1.2%

OVERVIEW:

Milk futures close lower to end the week on a negative note. Some optimism had been shown earlier in the week, but that changed somewhat due to lower spot prices. Packaged fluid milk sales in July declined 1.2% from the previous year.

MILK:

Milk futures showed some strength during the week but ended with weakness, as the underlying cash closed with lower prices on Friday. Milk futures closed higher than a week ago, with Class III contracts posting better gains than Class IV. Class IV futures struggled due to the weakness of butter. This increases the potential that milk prices will have difficulty showing strength throughout the rest of the year. If the underlying cash prices cannot find support during the time of year in which buying interest is strong, there may be little to support prices later in the year. Fluid milk sales in July declined 1.2% from July 2024. Whole milk sales declined 0.4%, flavored whole milk gained 4.7%, reduced-fat milk declined 7.0%, low-fat milk declined 5.8%, fat-free skim sales gained 13.3%, flavored fat-reduced milk jumped 22.0%, buttermilk gained 1.6%, while other fluid milk product sales gained 8.2%. Organic whole milk sales declined 3.2%, organic flavored whole milk gained 4.5%, organic reduced-fat milk declined 3.1%, organic low-fat milk declined 15.6%, organic fat-free skim declined 16.2%, organic flavored fat-reduced milk fell 39.5%, while organic other fluid milk products fell 46.5%.

AVERAGE CLASS III PRICES:

3 Month:	$17.17
6 Month:	$17.08
9 Month:	$17.07
12 Month:	$17.13

CHEESE:

For the week, blocks increased 3.50 cents with 22 loads traded. The weekly average price was $1.6525. Barrels gained 2.75 cents with no loads traded. The weekly average price was $1.6290. Dry whey decreased by 1.75 cents with eight loads traded. The weekly average price was 61.70 cents. It is unusual for no loads to have traded in barrels during the week. Buyers may not have needed barrels and showed little interest in purchasing aggressively. Sellers may not have had much to offer, indicating that supply and demand may be balanced.

BUTTER:

For the week, butter fell 11 cents with 39 loads traded. The weekly average price was $1.7910. Grade A nonfat dry milk declined 1.75 cents with 33 loads traded. The weekly average price was $1.1475. The butter price fell to the lowest level for the year and the lowest price since Oct. 11, 2025.

OUTSIDE MARKETS SUMMARY:

December corn closed up 0.25 cent per bushel at $4.2400, November soybeans closed down 12 cents at $10.2550 and December soybean meal closed down $0.70 per ton at $284. December Chicago wheat closed down 1.75 cents at $5.2250. October live cattle closed up $1.20 at $233.58. November crude oil is down $0.90 per barrel at $62.36. The Dow Jones Industrial Average is up 173 points at 46,315, with the NASDAQ up 161 points at 22,631.

Friday Midday Dairy Market Summary - Butter Falls to a New Low

OUTSIDE MARKETS SUMMARY:

CORN:	1 Lower
SOYBEANS:	12 Lower
SOYBEAN MEAL:	Unchanged
LIVE CATTLE:	$0.92 Higher
DOW JONES:	136 Points Higher
NASDAQ:	95 Points Higher
CRUDE OIL:	$0.77 Lower

MIDDAY MARKET UPDATE:

The block cheese price declined 3.25 cents, closing at $1.65 with no loads traded. The barrel cheese price remained unchanged at $.1.64 with no loads traded. No buyers showed up to do any business. The dry whey price increased a penny, closing at 64.00 cents with one load traded. Class III futures posted nice gains ahead of spot trading, but quickly turned lower with the weakness of blocks. Futures are 34 cents lower to 1 cent higher. The butter price declined 5.50 cents, closing at $1.75 with 12 loads traded. There is basically no hope for the butter price through the rest of the year, with it being unable to show strength at this time. Grade A nonfat dry milk gained 0.25 cent closing at $1.1425 with five loads traded. Class IV futures are 43 cents lower to 20 cents higher. Butter futures are 0.97 to 6.90 cents lower. Dry whey futures are 1.02 to 2.75 cents higher. Cheese futures are 0.10 to 4.20 cents lower. 

Friday Morning Dairy Market Update - Uncertainty Will Dominate Ahead of Spot Trading

OPENING CALLS:

Class III Milk Futures:	5 to 10 Higher
Class IV Milk Futures:	Mixed
Butter Futures:	Mixed

OUTSIDE MARKET OPENING CALLS:

Corn Futures:	1 to 2 Higher
Soybean Futures:	3 to 4 Higher
Soybean Meal Futures:	$1 to $2 Higher
Wheat Futures:	Mixed

MILK:

Milk futures made a nice rebound this week and have been able to hold those gains. Seasonal demand may have increased the buying interest in the underlying cash, providing some hope for increases in milk prices. However, traders remain cautious over further upside potential as prices historically peak in September or October. There is sufficient milk available for both bottling and manufacturing. Milk output has surpassed the low point of the year and should steadily improve.

CHEESE:

The inability of the block cheese price to show follow-through strength on Thursday keeps some negativity in the market, indicating the upside price potential may be limited. However, the barrel price holding steady may indicate there is support under the market, which may limit the downside weakness. Cheese prices may remain choppy.

BUTTER:

Buyers continue to purchase supplies without having to chase the price higher. Manufacturers continue to move butter to the spot market in an attempt to limit any further increase in inventory. Churning has increased as cream supplies increase. The price is expected to move back to the low again.